Fundamental overview:

USD/JPY is expected to consolidate with risks skewed lower after hitting a seven-year high at 121.86 on Monday. It is undermined by flows to haven JPY and unwinding of JPY-funded carry trades amid increased risk aversion (VIX fear gauge jumped 20.22% to 14.21, S&P 500 closed 0.73% lower at 2,060.31 overnight) as concerns mount over flagging global economic growth after data showed Japan's economy contracted more-than-expected 1.9% in 3Q, German industrial output rose less-than-expected 0.2% in October, while China's trade exports grew weaker-than-expected 4.7% in November. USD/JPY is also weighed by the weaker USD sentiment (ICE spot dollar index last 89.10 versus 89.38 early Monday) as U.S. Treasury yields fell overnight (10-year at 2.257% versus 2.307% late Friday) Bank of International Settlements warned on Sunday in its most recent quarterly report that there are potential adverse implications from a prolonged rally in the dollar for economies beyond the U.S. that have large U.S. dollar-denominated liabilities and Japan's export sales. But the USD sentiment is soothed by 6.1% rise in Conference Board U.S. employment trends index to 123.24 in November. USD/JPY losses are also tempered by the demand from Japan's importers and Bank of Japan's large-scale monetary easing policy.

Technical comment:
Daily chart is mixed as MACD is bullish, five and 15-day moving averages are advancing but stochastics is turned bearish at overbought levels, bearish dark-cloud-cover candlestick pattern was completed on Monday.

Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 120.10. A break of this target will move the pair further downwards to 119.60. The pivot point stands at 121.35. In case the price moves in the opposite direction and bounces back from the support level, then it will move above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 121.85 and the second target at 122.30.

Resistance levels:
121.85
122.30
122.65

Support levels:
120.10
119.60
119.30